Alfasi Steel Constructions is being sued by Japanese company Sanoyas for breach of contract, damages and breach of trust over the Melbourne Star Observation Wheel.Source:Supplied

THE LOCAL construction company that rebuilt the problem-plagued Melbourne Star Observation Wheel has denied claims it owes the tourist attraction’s owners $6 million.

Alfasi Steel Constructions — which is being sued by Japanese company Sanoyas for breach of contract, damages and breach of trust — has vowed to fight the allegations and to claw back money it claims to be owed.

Court documents lodged in the Supreme Court earlier this week allege Alfasi failed to hand over insurance money over a mishap during the then-named Southern Star wheel’s reconstruction in 2011.

Alfasi director Brett Wight said the handed over all agreed funds relating to the insurance claim.

“Alfasi says the rest of the money it was paid by Sanoyas was for its work to dismantle and rebuild the wheel because Sanoyas’ original design was inadequate and caused the wheel to fail in January 2009,” Mr Wight said.

“After having supported the project for over seven years, despite all the setbacks, Alfasi is disappointed that it is now being sued and says it will contest the claim vigorously to uphold and enforce what it agreed with Sanoyas’ Japanese representatives at the time, and to recover the money that is still outstanding to it from Sanoyas”.

The legal challenge, set down for a directions hearing on September 12, is the latest saga in the troubled wheel’s history.

Just this month the wheel came under fire by Docklands residents because of noisy maintenance work being carried out in the early hours of the morning.

In January the wheel ground to a halt due to a software glitch.

The troubled wheel reopened to the public on December 23 last year after five years of turmoil.